So Oil is expected to reach $100 here very soon and it is sitting currently at $80 dollars a barrel for light, sweet crude oil. As I say that, I think back to why I as a Real Estate investment person is focusing on the world oil market.
Let’s look at some facts of the matter. Not only is
there enough raw oil in the United States to last us
for 50 plus years alone, but we are not harvesting that oil ourselves and we are subjugating ourselves to the leaders of the Oil Producing and Exporting Countries (OPEC) and their price setting.
OPEC is currently running at only 80% capacity as well. This means that they could produce more barrels of light, sweet, crude oil for the open market, but since there is a lower demand, the price would go down. Yes, that is the very definition of artificial price inflation for a good or service.
You can thank OPEC for paying nearly $3.00 a gallon
for fuel right now, with an expectation that the price will only go up as the summer driving season kicks in.
Ok, so how does this relate to residential and commercial real estate investing? It completely relates. The rule of thumb when looking at an economy is that “housing starts”, or the amount of new homes that are being built, is a sign of a good or bad economy.
Well housing starts and home building companies rely on cheaper fossil fuels to help truck supplies across the US and run machines at job sites.
So what happens if the cost of cheap fossil fuels becomes not so cheap? The builders slow development, thus laying off more workers, and again heading away from an increase in production.
The lower production results in further declining home values. These lower priced home values equates to the best-priced Real Estate in decades. Use this opportunity to round out your investment strategy by using your IRA to invest in Real Estate.
Take some of the IRA funds that you have invested in simple stocks that have been under-performing as of late, and invest the money into a rental property, strip mall, or vacation home. But do it soon while
the best-priced properties are still available.
Let macroeconomics and fuel prices take care of themselves. You take care of your retirement.
No one else will.
Seize this opportunity to cement your retirement with dignity.
Paul R. Whitacre is a managing partner at WealthyIRA.com. Our vision is to teach others to invest their IRAs and 401(k)s in the deepest discounted Real Estate in decades. Check out more at our http://www.WealthyIRA.com blog and follow us on Twitter at http://www.Twitter.com/WealthyIRA
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